Trudeau, Li proclaim ‘golden decade’ for Canadian-Chinese economic ties; Really?

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metzlerBy John J. Metzler

UNITED NATIONS — Justin Trudeau, Canada’s media star Prime Minister, in his first address to the General Assembly, presented a wide-ranging tableaux of liberal platitudes and glowing feel good commitments.

Proclaiming an almost theological commitment to diversity, an acceptance of Syrian refugees, and climate change policies, Trudeau presented his view of a revived Canada as the perennial global good guy.

China's Li Keqiang with Canada's Justin Trudeau at the Great Hall of the People in Beijing, on Aug. 31. / Adrian Wyld / Canadian Press
China’s Li Keqiang with Canada’s Justin Trudeau at the Great Hall of the People in Beijing, on Aug. 31. / Adrian Wyld / Canadian Press

Stylistically Trudeau’s address offered the syrupy sweet political nuggets of a campaign speech.  But in substance there was so much lacking.  Pledges on human rights issues were notably missing; and this is a hall where many of the 193 delegations are anything but paragons of democracy, as is his country Canada.

Just days after Justin Trudeau’s victory lap in the cavernous UN General Assembly hall, he hosted Premier Li Keqiang from the People’s Republic of China.  The Chinese delegation flew to Canada to talk business.

Chinese Premier Li called for a “new Golden Decade” in Sino-Canadian commercial ties.

During a Montreal luncheon of the Canada/China Business Forum, Li proclaimed, “If a free trade agreement is established between our two countries it will open up boundless opportunities for investors and business leaders.”

Justin Trudeau added, “The economic potential between us is vast and we’d be doing a great disservice to our people if we didn’t tap into it.”

He alluded to the cooler Canadian relations with China during the previous conservative government.  He was also trading on his late-father Pierre Elliot Trudeau’s popularity, as Canadian Prime Minister, who had opened diplomatic relations with Beijing back in 1970, one of the first major Western countries to recognize Mao’s China.  Pierre Trudeau had a curious attraction to Mainland China, and this during an era when its totalitarianism was in vogue.

Ottawa’s two-way trade with China is US$65 billion but with a huge imbalance; exports to China reached $15 billion but imports from the Mainland surged to $50 billion. The plan is to double bilateral trade by 2026.  But as Prof. Meredith Lilly of Carleton University asserts, the widening trade will “only accentuate the already large trade imbalance we have with China.”

Beyond commerce, Canada has become a major destination for Chinese tourists.   Air Canada is inaugurating a new nonstop flight from Montreal to Shanghai.

Why the renewed warmth in Sino-Canadian ties now?

It is precisely China’s huge trade imbalance with the USA, a whopping $367 billion in 2015 alone, which remains a political lighting rod in the U.S. election campaign.  Both Donald Trump and his Democrat opponent Hillary Clinton talk tough on trade, especially concerning China.

Former Quebec Premier Jean Charest opines that “It’s probably safe to assume that the relationship with China is going to be tougher south of the border the day after the campaign than it is today, so I think the Chinese see Canada as a counterpoint to what’s happening in the U.S.”

Charest told Toronto’s National Post that “Strategically for the Chinese government it’s an opportunity.”

Beijing views the Canadian commercial chessboard as a plethora of opportunities for massive natural resource accession, trade, and a tariff free back door to the USA market.  China is Canada’s second largest trade partner, right after the United States.

The Canadian province of Alberta remains the third largest oil producer in the world; yet since the drop in oil demand and the shelving of the Keystone XL pipeline, the Western region has suffered huge job losses.  People’s China is keenly interested in this massive oil producer.

Beyond that the Trans-Pacific Partnership trade deal being pushed by the Obama Administration, but now opposed by both Trump and Clinton, nonetheless does not envisage China as a member.

To get around TPP, if it were eventually to pass in Washington, Beijing would do an end run  securing an eventual Free Trade Agreement with Ottawa.  Such a deal is part of the Golden Decade Premier Li extols, but specifically would see a widening flow of Chinese exports to Canada which in turn through loopholes may get into the USA via NAFTA.

People forget that the North American Free Trade Accord covers a free flow of commerce between the U.S. and Mexico AND Canada.  In other words, even with possible tighter American restrictions on Chinese trade, Beijing could get its products into the USA tariff free via NAFTA.

Notwithstanding trade policy, it’s the Trudeau government’s flawed political rationalizations over  Beijing’s human rights policies which hinder a closer relationship between Canada and the People’s Republic of China.  Canadians feel distinctly uncomfortable over this.

John J. Metzler is a United Nations correspondent covering diplomatic and defense issues. He is the author of Divided Dynamism the Diplomacy of Separated Nations: Germany, Korea, China (2014). [See pre-2011 Archives]

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